Deputy Assistant Attorney General Brenna Jenny Offers Insight on DOJ Civil Rights Fraud Enforcement

Deputy Assistant Attorney General (DAAG) Brenna Jenny (Civil Division, Commercial Litigation Branch, Department of Justice) addressed the Federal Bar Association’s annual Qui Tam Conference as part of a panel titled “Illegal DEI as an FCA Trigger?” on February 19, 2026, and separately delivered the conference’s keynote speech. Her remarks provide context regarding trends and expectations in investigations initiated as part of DOJ’s Civil Rights Fraud Initiative.

Morgan Lewis has provided extensive analysis on this topic since the Civil Rights Fraud Initiative was announced in May 2025, [1] and DAAG Jenny’s statements are a valuable reflection of DOJ’s current thinking in this novel and evolving enforcement area. Federal contractors—whether they are currently facing civil rights fraud-related enforcement or not—should consider the positions outlined by DAAG Jenny in evaluating their potential defenses.

HIGH-LEVEL TAKEAWAYS

The tenor of DAAG Jenny’s remarks telegraphed that DOJ is fully committed to investigating, and, where it believes appropriate, pursuing False Claims Act cases against federal contractors for violations of anti-discrimination laws or regulations. There was no indication that DOJ shares the defense bar’s skepticism as to the legal viability of such cases. To the contrary, DAAG Jenny was clear that the government does not find the balance of these defenses to be persuasive. In short, federal contractors should be aware that DOJ does not intend to lessen its enforcement activity in this area anytime soon.

Although much of the commentary addressing the Civil Rights Fraud Initiative has focused on the concept of “illegal DEI”—as that term was used in Executive Order 14173, for example [2]—DAAG Jenny explained that there is no necessary connection between a contractor having DEI programming and violating the anti-discrimination laws, and it is the latter that DOJ is interested in investigating.

In other words, DAAG Jenny explained that a contractor could operate a DEI program without engaging in illegal discrimination, its DEI program could constitute illegal discrimination, or there could be illegal discrimination in the absence of any DEI program.

DAAG Jenny confirmed that the Civil Rights Fraud Initiative primarily has focused its investigative power on potential race and sex discrimination by corporate government contractors and that these investigations have been initiated directly by DOJ and by qui tam relators. While this information is unsurprising, it is still significant to hear public confirmation that qui tam complaints based on alleged race or sex discrimination by corporate government contractors are in play.

THEORIES OF LIABILITY

DAAG Jenny also walked through the elements of a False Claims Act (FCA) claim—falsity, materiality, scienter, and damages—and discussed why DOJ believes that a contractor’s violations of the anti-discrimination laws can support a viable FCA case.

A significant theme was evident in her analysis: DOJ understands that a contractor’s adoption of generic corporate DEI practices is not sufficient in and of itself to establish legal liability. Rather, to prove an FCA case, the government will need to establish that any such practice resulted in adverse employment practices or decisions affecting employees or applicants. For instance, a contractor’s adoption of an aspirational representational goal suggests only the possibility of unlawful discrimination, but it does not constitute such discrimination in itself, absent proof of resulting adverse employment decisions.

Falsity

On the element of falsity, DAAG Jenny explained the government’s view that discrimination on the basis of protected characteristics has long been illegal and forbidden by federal contracting regulations. [3] Pointing first to DOJ’s July 2025 Guidance, [4] DAAG Jenny offered several examples of practices DOJ believes would run afoul of these rules, including: giving preferential treatment in hiring or promotion on the basis of protected characteristics; conditioning participation in professional programming on the basis of protected characteristics; or giving certain individuals the opportunity to interview for jobs or promotions because of protected characteristics (for example, so-called “diverse slate” interview policies).

DAAG Jenny then highlighted issues and practices that are the focus of its current investigations. In particular, she singled out practices that put “pressure” on corporate management to make hiring and promotion decisions on the basis of race or sex, providing as examples: (1) corporate monitoring of internal demographic data in a fashion that is untethered from OFCCP underutilization analyses; (2) linking employee compensation to the achievement of corporate demographic representation goals; and (3) requiring employees on an individual basis to develop their own “DEI goals” (e.g., staffing their projects with a certain number of individuals from a given racial group) that could likewise impact their compensation or prospects for promotion.

The throughline here is that DOJ is interested in corporate practices that incentivize corporate management to make individual hiring decisions on the basis of race or sex, which is proscribed by anti-discrimination law and contracting regulations. DAAG Jenny’s remarks suggest the government understands that, to show falsity in these cases, demonstrating a nexus to individual employment decisions will be necessary.

DAAG Jenny described DOJ’s best cases for falsity as those in which policy pressure resulted in decisions being made because of race, sex, or other improper characteristics. Where policies operated to encourage employees to engage in such illegal actions, then DOJ may believe the proscribed conduct is more likely and thus the policies present a tempting target for further investigation.

Materiality

DAAG Jenny spoke to why the government views compliance with anti-discrimination law as material to its contracts generally. She explained that DOJ sees government contracting in the following light: when the federal government enters into contracts, it is choosing a “partner” to carry on public work using the public’s funds. Anti-discrimination laws reflect not only the government’s policy choices but are part-and-parcel of the core principles of the United States going back to its founding —indeed, DAAG Jenny described them as reflecting a “moral intuition.”

Accordingly, DAAG Jenny’s view is apparently that, even if compliance with anti-discrimination law may seem ancillary to the purposes of a contract to, for example, provide machinery parts to the Navy, they are such a fundamental part of the government’s commitments that a contractor’s violation of them (at least in some cases) can be material for FCA purposes.

Against this value-laden backdrop, DAAG Jenny expects that juries will find relators’ allegations of corporate discrimination to be compelling, and that jurors will consequently accept the government’s position that compliance with the anti-discrimination laws is a material component of the contracts at issue.

Scienter (Knowledge)

DAAG Jenny was sanguine about DOJ’s ability to prove scienter in appropriate cases. She explained that, in some instances, the evidence of intentional discrimination will be direct (for example, a written directive to hire a certain number of persons of a particular race), and she seemed to suggest that proving scienter in such a case would practically be axiomatic.

She also described cases where evidence of deception by the contractor could support scienter. For example, if corporate training materials state that preferential treatment based on race is prohibited, yet managers are contemporaneously opining that more members of particular groups need to be hired, then that could be evidence of scienter, as well.

THEORIES OF DAMAGES

Finally, DAAG Jenny previewed how DOJ would approach assessing damages in a civil rights fraud case. She explained that the traditional assessment factors employed by Civil Frauds will continue to apply, including cooperation, self-disclosure, and the length and scope of the misconduct.

In some cases, DOJ may conclude that the government would not have entered the contract at all based on the discrimination, and thus the measure of single damages would be the full value of the contract. However, DOJ may assess the case in other ways as well; for instance, by looking to the cost of any alleged discriminatory activities that were passed on to the government via false claims.

Significantly, DAAG Jenny stated that she expects, in civil fraud discrimination cases, DOJ will seek penalties in addition to damages in any settlements. The purpose of doing so would be to advance deterrence of the underlying discriminatory conduct.